Shares of F5 Networks (NASDAQ:FFIV) are lower today after the company reported earnings. Total revenue climbed 11% year-over-year to reach $703 million, but software revenue dropped 13%. In response to the mixed results, the company announced it would be cutting roughly 9% of its workforce or around 620 employees.
Nevertheless, KeyBanc Capital Markets analyst Thomas Blakey pointed out some positives, like the growth in new deals and expanding pipelines. F5’s CEO, François Locoh-Donou, mentioned that due to ongoing macro uncertainties and their impact on customer spending, the company expects low-to-mid single-digit revenue growth in Fiscal Year 2023.
The firm’s Non-GAAP EPS of $2.53 exceeded expectations, and F5 reaffirmed its commitment to giving back to shareholders through share repurchases. With $1.23 billion still available under its authorized common stock repurchase program, the company plans to buy back at least $250 million worth of shares in the next quarter. However, F5 anticipates revenue to land between $690 million and $710 million, with non-GAAP diluted earnings per share ranging from $2.78 to $2.90. As a result, the midpoints are slightly below the consensus estimates of $702 million and $2.86 per share.
Overall, Wall Street analysts have a consensus price target of $156.92 on FFIV stock, implying almost 19% upside potential, as indicated by the graphic above.
